U.S. Dollar Rebounds As JOLTs Job Openings Exceed Expectations

Key Insights

• Strong job market data provided support to the American currency. 
• AUD/USD lost momentum and pulled back towards the 0.6400 level. 
• EUR/USD tested resistance at 0.9950 but failed to gain sufficient upside momentum and declined towards the 0.9900 level. 

U.S. Dollar Index Moved Back Above The 111 Level

U.S. Dollar Index moved away from session lows after the release of the JOLTs Job Openings report, which indicated that job openings increased from 10.28 million in August to 10.7 million in September.

The job market remains in a decent shape, which is bullish for the U.S. dollar as the Fed has an opportunity to raise the rate aggressively. Not surprisingly, the forex market is especially sensitive to job market data ahead of the Fed Interest Rate Decision, which will be released tomorrow.

The U.S. has also released ISM Manufacturing PMI report, which indicated that ISM Manufacturing PMI declined from 50.9 in September to 50.2 in October, compared to analyst consensus of 50. The report provided additional support to the American currency.

EUR/USD Tries To Settle Below 0.9900

EUR/USD has recently made an attempt to settle above the 0.9950 level but lost momentum and pulled back towards 0.9900 after the release of job market data from the U.S.

The nearest support level for EUR/USD is located near the 20 EMA at 0.9880. In case EUR/USD settles below this level, it will move towards the support at 0.9850. A successful test of the support at 0.9850 will open the way to the test of the next support level at 0.9810.

On the upside, the nearest resistance level is located at the 50 EMA at 0.9920. If EUR/USD climbs back above the 50 EMA, it will head towards the resistance at 0.9950. A move above this level will push EUR/USD towards the resistance at 0.9975.

GBP/USD Tests Support At 1.1500

GBP/USD is currently trying to settle back below the 1.1500 level. Today, GBP/USD traders had a chance to take a look at the final reading of the UK Manufacturing PMI report for October, which indicated that UK Manufacturing PMI declined from 48.4 to 46.2, compared to analyst consensus of 45.8.

The report exceeded expectations, but the UK economy remains under strong pressure due to the severe energy crisis. Meanwhile, the yield of 10-year UK government bonds has recently moved back above the 3.50% level, which may put some pressure on the pound.

AUD/USD Declines As U.S. Economic Reports Exceed Expectations

AUD/USD pulled back towards the 0.6400 level as traders reacted to the release of the JOLTs Job Openings data from the U.S. Today, RBA raised the interest rate from 2.6% to 2.85%, in line with the analyst consensus. This move had little impact on the dynamics of the Australian dollar.

NZD/USD has also lost momentum and pulled back towards 0.5830, while USD/CAD rebounded towards 1.3630. Commodity-related currencies received some support today due to the rebound in commodity markets, but the recent rebound of the U.S. dollar may put additional pressure on them.

USD/JPY Found Support Near The 20 EMA

USD/JPY received support at the 20 EMA at 147.15 and moved back above the 148 level. The key question for USD/JPY traders is whether the BoJ will try to defend the 150 level if USD/JPY gets there.

The fundamental situation remains unchanged as the BoJ sticks to its ultra-dovish policy while the Fed will likely raise the rate by 75 bps tomorrow, which is bearish for the yen.

For a look at all of today’s economic events, check out our economic calendar.